Deere beats Q2 EPS estimates but shares fall as ag sales drop, construction grows.

Deere reported Q2 fiscal 2026 diluted EPS of $6.55, surpassing estimates of $5.70 to $5.81, with revenue up 5% year-over-year to $13.37 billion. Despite this, shares fell over 5% due to a decline in its core Production and Precision Agriculture segment, which saw net sales drop 14% and margin compression. Growth in Small Agriculture, Turf, and especially Construction and Forestry segments offset agricultural weakness, signaling a durable shift in Deere's business mix. The company maintained full-year net income guidance but faced investor concerns over a non-recurring $272 million cost recovery and ongoing agricultural market softness. Deere’s future valuation may increasingly reflect its expanding construction and forestry focus rather than traditional farming equipment.